James E. Flynn’s Deerfield Management filed yesterday with the SEC an Initial Statement of Beneficial Ownership of Securities of Proteon Therapeutics Inc (NASDAQ:PRTO), a company that went public today. The fund disclosed ownership of 535,219 shares of Series D Preferred Stock*, and 428,175 Series D Purchase Rights**. Previous to the offering, the fund held a 10% stake in the company; the post-IPO wage accounts for approximately 6.7% of the company´s shares outstanding.
Deerfield Management is a non-activist, healthcare-focused investment company that specializes in funding R&D, managing hostile takeovers, corporate transitions and financial advisory services. It was founded in 1994, and has been based in New York City ever since. It has been managed by James E. Flynn since 2000, and currently oversees about $5 billion in assets. The fund seeks to advance healthcare through investment, information and philanthropy.
Proteon Therapeutics Inc (NASDAQ:PRTO), for its part, is a $141.7 million market cap biopharmaceutical company, currently developing pharmaceuticals to address the medical needs of patients with renal and vascular diseases. The initial public offering opened today for trading at $11.30, after the company had priced 6.11 million shares of its common stock at a public offering price of $10.00 per share. The proceeds of the IPO will be most likely allocated to fund research and development activities.
In addition to Deerfield Management, some of Proteon Therapeutics Inc (NASDAQ:PRTO)’s Board Directors held big chunks of stock before its IPO. Some noteworthy investors (insiders) are Hubert Birner, Brendan O’leary, Gordon John Freund and Timothy Haines. Each one of these Directors held, at least, 14% of the company’s pre-IPO stock, and will own more than 9% of the post-IPO shares outstanding.
As mentioned above, Deerfield Management has an eye for healthcare stocks. Its largest long equity position, Auxilium Pharmaceuticals, Inc. (NASDAQ:AUXL), another small-cap healthcare company, returned more than 48% year-to-date, outperforming all indexes and most of its industry peers.
* Each share of Series D Preferred Stock is convertible at any time into 0.063 shares of the company’s common stock (on an adjusted basis, after giving effect to the 1-for-15.87 reverse stock split effected by the Issuer on October 6, 2014). These shares will be automatically converted into Common Stock upon the closing of the company’s initial public offering, and have no expiration date (SEC).
** The Series D Purchase Right entitles the holder to purchase shares of Series D Convertible Preferred Stock under the Series D Preferred Stock purchase agreement at a price of $0.588656 per share. The right to purchase is not currently exercisable and shall terminate upon the completion of the company’s initial public offering.
Disclosure: Javier Hasse holds no positions in any stocks or funds mentioned
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